Gillian Keegan: We have always believed that anyone who wants to, and can benefit from it, should get access to a world-class higher education. Since we took over from Labour, 18-year-olds from disadvantaged backgrounds are 82% more likely to enter full-time higher education—that is for 2021 compared with 2010. Our reforms will make student loans more sustainable and fairer for graduates and taxpayers, and will help to boost learning across a lifetime, not just in universities. A full equality impact assessment of the changes has been conducted and was published on 24 February.

Claire Coutinho: I thank the hon. Gentleman for that question. Childcare is of course enormously important, and it is this Conservative Government who have expanded the childcare offer successively over a number of years. Last year in the spending review, we set out an additional £500 million to come into the sector, and we are  also supporting private providers with their energy bills  this year.[Official Report, 6 December 2022, Vol. 724, c. 4MC.]

Matt Western: I welcome the new Secretary of State and the rest of her team to the Front Bench. On 19 October, in a written parliamentary question, I asked the previous universities Minister, the hon. Member for Morley and Outwood (Andrea Jenkyns), whether she had conducted an equalities analysis of the impact of rising prices on students. In short, the Government had not, so do they have any idea of how the cost of living is affecting students from disadvantaged and diverse backgrounds?

Claire Coutinho: The Department has significantly expanded the number of fully funded initial teacher training places in early years for the next academic year, and it is reviewing the level-3 qualification criterion for early years, both of which are part of our package of £180 million-worth of support.[Official Report, 6 December 2022, Vol. 724, c. 3MC.]

Claire Coutinho: I know that my hon. Friend is a huge supporter of Jelly Babies, both the nursery and otherwise. The Government are supporting early years professionals with £180 million for qualifications and specific training, such as on dealing with challenging behaviour following the pandemic and on early communication.[Official Report, 6 December 2022, Vol. 724, c. 3MC.]

Claire Coutinho: As I said in answer to earlier questions, we put an extra £0.5 billion into the early years sector in the 2021 spending review to increase the hourly rate. We are also spending money on qualifications and training for teachers. This sector is very important to us, and we continue to consider all the ways we can support it.[Official Report, 6 December 2022, Vol. 724, c. 4MC.]

Nick Gibb: Attendance in all state-funded schools in the period 12 September to 21 October was 93.6%. Broken down by school type, attendance was at 94.9% in primary schools, 92.2% in state secondary schools and 88.1% in special schools. Our focus now is to help and support those pupils who face barriers to returning to school following the covid lockdown.

Gillian Keegan: I can confirm that we have a world-class education system and we will attract the brightest students from around the world. That is good for our universities and delivers growth at home. We were proud to meet our international student ambition earlier this year to attract 600,000 international students per year by 2030. Today that is worth £29.5 billion and we are now focused on bringing in £35 billion from our education exports, which are the best in the world.[Official Report, 19 December 2022, Vol. 725, c. 2MC.]

Nick Gibb: We have been delivering defibrillators in schools up and down the country—it is a successful programme. I will write to the hon. Member with the precise figures that she is seeking.[Official Report, 29 November 2022, Vol. 723, c. 8MC.]

Nick Gibb: Yes, I certainly will look into that. The school was initially closed as a precaution while we carried out enhanced testing. Testing is now complete, and the school buildings are safe, but asbestos remains on the site of a previously demolished building, so the school will remain closed while that is removed. However, we are doing everything possible to ensure that the school site reopens by 3 January.

David Rutley: I congratulate my right hon. Friend on securing the urgent question.
Saudi Arabia remains a Foreign, Commonwealth and Development Office human rights priority country, particularly because of the use of the death penalty and restrictions on freedom of expression. We seek to engage the kingdom and support positive reform, and Lord Ahmad, the Minister responsible for our middle east and north Africa policy, visited the kingdom in February to advance UK strategic engagement on human rights specifically. Key areas included promoting freedom of religious belief, lobbying on individual human rights cases of concern and encouraging justice reforms. Saudi Arabia is committed to an ambitious programme of economic and social reform through Vision 2030, which has already delivered significant change, including increased freedoms and economic opportunity for women. However, the human rights situation is likely to remain a key issue in our engagement for the foreseeable future.
It is a long-standing UK policy to oppose the death penalty in all circumstances in all countries as a matter of principle. The Saudi Government are well aware of the UK’s opposition to the use of the death penalty. The Saudi authorities have executed around 150 individuals in 2022, a marked increase on the 67 executions last year. On 12 March 2022 Saudi Arabia executed 81 people in a single day, and the British ambassador raised UK concerns with Saudi authorities at both ministerial and senior official level in Riyadh on 14 March. The then Middle East Minister, my right hon. Friend the Member for Cannock Chase (Amanda Milling), also raised concern over the 81 executions with the Saudi ambassador to the UK. More recently, Saudi Arabia has executed 20 individuals for drugs-related offences since 10 November despite Saudi Arabia’s moratorium on the death penalty for drugs-related offences announced in January 2021.
Lord Ahmad, the Minister responsible for the middle east and human rights, requested a meeting and spoke to the Saudi ambassador last week, on 24 November. He raised UK concern over the recent executions and pushed for the 2021 moratorium for drugs-related offences to remain in place. During the meeting Lord Ahmad also raised an important case for my right hon. Friend, that of Hussein Abo al-Kheir, who is assessed by respected international non-governmental organisations to be at risk of imminent execution. There are allegations of torture and forced confession in this case, and the Minister reiterated His Majesty’s Government’s long-standing position on the death penalty and the importance of ensuring the 2021 moratorium was upheld.
Through Ministers and our embassy in Riyadh we regularly raise the death penalty as a key issue of concern with Saudi Arabia. We will continue to do so, and no aspect of our relationship with Saudi Arabia prevents us from speaking frankly about human rights.

David Rutley: I thank my right hon. Friend for raising these issues and for doing so with his characteristic passion and conviction. His record on civil liberties and human rights is well known, and I want to reassure him once again that Lord Ahmad raised the case of the Jordanian national Mr al-Kheir with the Saudi ambassador on 24 November—so just last week he requested that meeting and had the conversation—and earlier in the year, on 25 January, Lord Ahmad raised the same case with the Saudi Justice Minister during the Minister’s visit to the UK. Our embassy in Riyadh has raised this case with relevant authorities and we will continue to monitor it and raise it at the highest levels.

David Rutley: We have already expressed our concerns, particularly about Mr al-Kheir’s case, in which clearly torture was used. We find that abhorrent. We have raised that issue at the highest level and will continue to do so, not just in his case but in other cases in which that might be happening as well.[Official Report, 2 December 2022, Vol. 723, c. 12MC.]

Robert Jenrick: May I extend my apologies, on behalf of the Department, to the right hon. Member for Normanton, Pontefract and Castleford (Yvette Cooper)—and, indeed, to you, Mr Speaker—for the delay in providing a copy of the statement? With your permission, however, I will now make a statement about the public health considerations in asylum accommodation.
As the House will know, on the morning of 19 November an individual who had arrived in the United Kingdom on 12 November, and who had been staying at the Manston processing site, sadly died in hospital. Initial test results for an infectious disease were negative, but a follow-up PCR test was positive. We must now await the post mortem results to determine the cause of death, and our thoughts are with the individual’s family.
There has been speculation about the wider health implications across the asylum accommodation system, so I wanted to come to the House to set out the facts, to outline the steps that have already been taken to protect migrants and the general public, and to reassure the public about the additional precautionary measures that we are now taking.
The control and testing of infectious diseases is led by the UK Health Security Agency and the Department for Health and Social Care. The Home Office continues to work closely with both, taking their advice on all these matters and following it. As part of our ongoing dialogue, the Home Secretary and I were updated on the situation over the weekend by Dame Jenny Harries of the UKHSA, who confirmed to us that 50 cases of diphtheria had been reported in asylum accommodation. It is important to emphasise that the UKHSA has made it clear that the risk to the wider UK population from onward transmission of diphtheria is very low, thanks in no small part to our excellent childhood immunisation programme, and also because the infection is typically passed on through close prolonged contact with a case. The UKHSA confirmed that it considers it likely that these cases developed before they entered the UK.
The Home Office has worked closely with the NHS and the UKHSA to identify and isolate anyone with a diphtheria infection. That includes providing diphtheria  vaccinations and moving confirmed cases into isolation. While these robust processes and plans for a situation of this type are already in train, it is absolutely right for us now to be vigilant: that is what the public would expect, and that is what we are doing. There are, for instance, robust screening processes on the arrival of individuals at Western Jet Foil in Dover to identify proactively those with symptoms of diphtheria; “round-the-clock” health facilities at Manston, including emergency department consultants and paramedics; guidance in multiple languages on spotting the symptoms of diphtheria; and an enhanced diphtheria vaccination programme, offered to all those arriving at Manston. I can confirm that of those who arrived at the facility this weekend, 100% took up that vaccine offer. There is testing for those presenting with symptoms and for close contacts, and those testing positive are being isolated in a designated place.
Today we are going above and beyond the UKHSA baseline by instituting new guidance on the transportation and accommodation of individuals displaying diphtheria symptoms. From today, no one presenting with symptoms will progress into the asylum accommodation system. They will either remain at Manston, isolating for a short period, or they will travel to a designated isolation centre in secure transport, where they will be treated until deemed medically fit. This is a well-practised protocol from covid times.
We will also continue to ensure that all asylum accommodation providers are given access to the very latest public health advice from the UKHSA, and we will ensure that they are aware of their responsibilities for testing and isolating cases of infectious disease. We will continue working with the UKHSA to ensure that arrangements are of the highest standard and that the UKHSA has everything it needs from the Home Office. We are engaging with French counterparts to assess the state of infectious disease in the camps in northern France.
I fully understand and appreciate the concerns that have been raised, and I assure the House that the Home Office is acutely aware of our responsibility both to those in care and to the British public. For me, the Home Secretary and the Government as a whole, public health is paramount. We will take all steps necessary to ensure that the public are protected. I commend this statement to the House.

Yvette Cooper: Thank you, Mr Speaker, and thank you for your words about the difficulty of responding to a statement with just 10 minutes’ notice.
I thank the Minister for the information he has given us, but why is the Home Secretary not here? This is supposed to be her top priority. In the past few weeks we have had two urgent questions, a debate and this statement on the chaos, and she has not done any of them. I have to ask: what is she for? She obviously does not have a grip, and she has made this chaos worse.
The Government have failed to stop the proliferation of criminal gangs in the channel, are still refusing to adopt Labour’s proposal for a new National Crime Agency unit to target the gangs, and have failed to sort out the chaos in asylum decision making. They are  taking only half as many as they were six years ago, even though they have more staff. Just 2% of last year’s small boats cases have been decided, creating a backlog of nearly 100,000 people waiting more than six months for a decision, compared with just 4,000 when they took office. All of this has led to a completely inappropriate use of hotels, at the last minute, with no proper information for local councils or public health officials.
Then, of course, there is the chaotic handling of the situation at Manston. The Minister has just said that there are 50 diphtheria cases. Can he confirm that that compares with just three cases last year? Can he tell us when Ministers were first told of diphtheria cases at Manston? When were they warned? By mid-October, the Home Office admitted publicly that there were cases at Manston, but Home Office officials told the Home Affairs Committee on 26 October that they had sufficient health arrangements in place to address diphtheria. Clearly they did not.
The Government still kept thousands of people in overcrowded conditions, described by one person as “huddled around fan heaters, thousands of people in overcrowded conditions trying to stay warm.” These conditions clearly make it easy for infectious diseases to spread. The processes described by the Minister are important, but why on earth were they not put in place many weeks ago? It took until 11 November, after thousands of people had been held there for weeks, for diphtheria screening and vaccinations to be recommended for everyone passing through Manston. What on earth were they doing in the meantime?
Even then, on that same day, the Home Office was moving people who had been in Manston into hotels across the country, without even telling councils or public health officials. In one case, the council was specifically told that people were not transfers from Manston even though they were. In other cases, councils were told nothing at all, and there was no information for public health officials about whether people needed further diphtheria screening and vaccinations; this included leaving people to seek treatment for themselves for diphtheria symptoms at local accident and emergency departments.
The Health Secretary has said that 500 people have now been screened and vaccinated, but what about the other several thousand people who have been in Manston? Wherever they now are in the country, have they been screened or vaccinated for diphtheria as well? If not, why on earth not, because that was the public health recommendation nearly three weeks ago and that was already late? Have all those with possible symptoms now been given precautionary antibiotics? Again, if not, why not? We are told that diphtheria is an easy infection to treat and to vaccinate against, which is why we have a universal vaccination policy in the UK. But that needs proper information for health officials to be able to use and the Home Office to get a grip.
Clearly, the Government have ignored health advice and legal advice. The Business Secretary said publicly that when he was a Home Office Minister he was advised that he had to act as he was breaking the law. The permanent secretary has now said that the Home  Secretary was given the same legal advice, so why did she not act, either on the legal advice or on the health advice?
I am sure that the Immigration Minister is working really hard to try to sort this out. The problem is that everyone else is struggling to clear up the Home Secretary’s chaos and she is not even here. It is chaotic. This issue is too important not to have a grip in place, and if the Home Secretary is too frit to attend this House and take responsibility for her decisions, she should get out the way and let someone else do the job.

Robert Jenrick: I am grateful to the right hon. Lady for those questions. She asked how long we have been aware of diphtheria cases. When I addressed the House for the first time, on 1 November, I reported that there had been four cases. I am able now to say that that has increased to 50 cases, and I will continue to update the House as this issue develops.
The right hon. Lady asked whether Ministers have followed the advice of the UK Health Security Agency throughout. To the best of my knowledge, they have. We have always sought and followed the advice of Dame Jenny Harries and her colleagues. In fact, the measures I have announced today go beyond the UKHSA’s baseline advice, because we want to take a precautionary approach. For that reason, we will be ensuring that further individuals who have any symptoms are not transported around the country; they will either remain at Manston or go to specialist accommodation. That accommodation is readily available, because we made good use of it during the height of the covid pandemic and we will be making sure it is brought into use in the coming days.
The right hon. Lady asked about screening arrangements. Those have been in place for some time. All individuals arriving at Western Jet Foil are screened. That is, by necessity, a relatively simple screening, because on occasion thousands of illegal migrants arrive in the course of a single day, but screening is followed up at Manston and we have asked the UKHSA to advise us on whether further measures are required to ensure that that screening is more sophisticated. Dame Jenny and her colleagues will advise on that.
We have had the vaccination programme in operation for a number of weeks. It is a voluntary programme; we do not compel migrants to take it up. It began at a relatively low level of acceptance—about 45%—but that is now increasing; as I said, I am pleased to say that we have reached 100% for those who came over the weekend. We will do everything we can to maintain it at or around that level, because that clearly is a very important line of defence.
For those individuals who have already left Manston and have flowed into asylum accommodation elsewhere in the country, we and the UKHSA are now going to work closely with local directors of public health to ensure that they have the right guidance to protect those individuals. Those local public health directors will work with local NHS partners to ensure that the individuals have treatment under the NHS and that they isolate in their rooms within those hotels or other forms of accommodation. The outsourced partners will ensure that the people have food and laundry brought to the door, so that there is no reason whatsoever that they should leave their room until they are well again and can re-enter broader society.
If there are further measures that we need to take, we will do so. Dame Jenny and her colleagues are meeting directors of public health this week, as they have been doing repeatedly in recent months, to hear their concerns and ensure that these procedures are progressively improved as required.

Daisy Cooper: On 3 November, I tabled a series of written parliamentary questions asking Ministers to publish the protocols for screening, immunisation and prevention in relation to outbreaks of infectious diseases at Manston and other immigration centres, as well as the protocols for sharing information with directors of public health and local authorities. More than a week later, on 11 November—it took another week to publish advice—UKHSA said that antibiotics and vaccination would be offered to asylum seekers in Manston and in other places where they had been dispersed “where these are known”. It is now 28 November—more than three and a half weeks after my question—and my local directors of public health and general practitioners are asking how on earth they can deliver a vaccination programme when UKHSA appears not to know where these centres are and the Home Office does not tell them.

Joanna Cherry: On 2 November, nearly a month ago, I, as Chair of the Joint Committee on Human Rights, together with the Chairs of the Home Affairs, Justice, and Women and Equalities Committees, wrote a long and detailed letter to the Home Secretary posing various questions about the conditions at Manston. We asked for a reply by 16 November, but still have not had one.
When the Home Secretary was before the Home Affairs Committee last week, she said that there was a processing issue at the Home Office and that we would get our response very quickly. We are still waiting. Can the Minister give us an indication of when the Home Secretary will deign to respond to this important letter from the Chairs of four Committees of this House?

Feryal Clark: The Minister has previously said that he was left speechless by the safety problems at Manston. He also said on 27 October:
“We want to ensure that the site is maintained legally”.—[Official Report, 27 October 2022; Vol. 721, c. 403.]
In response to my right hon. Friend the Member for Kingston upon Hull North (Dame Diana Johnson), he said, “we are broadly there”. What does “broadly there” mean? Is the site maintained legally or not?

Diana R. Johnson: On a point of order, Madam Deputy Speaker. I would like to follow up on the question asked in the statement by the hon. and learned Member for Edinburgh South West (Joanna Cherry), the Chair of the Joint Committee on Human Rights. Four Chairs of Select Committees—the hon. and learned Lady; I as the Chair of the Home Affairs Committee; the Chair of the Justice Committee, the hon. Member for Bromley and Chislehurst (Sir Robert Neill); and the Chair of the Women and Equalities Committee, the right hon. Member for Romsey and Southampton North (Caroline Nokes)—wrote a letter to the Home Secretary on 2 November in which we asked for a response by 16 November. At the Home Affairs Committee last week, I asked where the response was. It worries me that the permanent secretary had no idea about the letter, the Home Secretary had no idea about the letter, and today the Minister for Immigration had no idea about the letter. What can we do to assist the Home Office in dealing with correspondence that comes from this place and from four Select Committee Chairs, as it seems not to be able to deal with it?

James Cartlidge: I am grateful to my hon. Friend and will of course check with the Chief Secretary’s office; my officials will have heard the point he makes and will ensure he receives a response. On inflation in infrastructure costs, obviously that will apply across the board and cannot in itself be a reason to reconsider such fundamental investment. There are strong views on this project; from the Government’s point of view, it creates thousands  of jobs and apprenticeships and builds much greater connectivity. But of course, as the Chief Secretary himself has been clear—I am sure he will emphasise this in the letter to my hon. Friend—we need to see discipline on cost control whatever is happening to wider macroeconomic factors.
Turning to the substance of the Bill and the specific measures, I shall start with the energy profits levy. Since energy prices started to surge last year there have been calls for the Government to ensure that businesses that have made extraordinary profits during the rise in oil and gas prices contribute towards supporting households that are struggling with unprecedented cost of living pressures. This Bill takes steps to do exactly that by ensuring oil and gas companies experiencing extraordinary profits pay their fair share of tax. We are therefore taxing these higher profits, which are due not to changes in risk taking or innovation or efficiency, but as the specific result of surging global commodity prices driven in part by Russia’s illegal invasion of Ukraine.
The measure increases the rate of the energy profits levy that was introduced in May by 10 percentage points to 35%. This will take effect from January next year, bringing the headline rate of tax for the sector to 75%, triple the rate of tax other companies will pay when the corporation tax rate increases to 25% from April next year or 30% for the largest companies. The Bill also extends the levy until 31 March 2028, but as the Government have made clear, it is important that such a tax does not deter investment at a time when shoring up the country’s energy security is vital.

James Cartlidge: I am grateful to my hon. Friend. Of course, he was in the Department and has a business background, so he knows the detail and the importance of R&D tax reliefs. I am sure that my hon. Friend the Financial Secretary to the Treasury will have a chance to look at that later. I believe that we will be having a meeting about a separate issue of concern—a certain railway project that matters to him—when we can also discuss these points.
I turn to the specific detail. For expenditure on or after 1 April 2023, the research and development expenditure credit rate will increase from 13% to 20%. The small and medium-sized enterprise additional deduction will decrease from 130% to 86%, and the SME scheme credit rate will decrease from 14.5% to 10%. That reform will ensure that the taxpayer support is as effective as possible. It improves the competitiveness of the RDEC scheme and is a step towards a simplified RDEC-like scheme for all.
That means that Government support for the reliefs will continue to rise in cost to the Exchequer—from £6.6 billion in 2021 to more than £9 billion in 2027-28—but in a way that ensures value for money. To be clear, the R&D reliefs will support £60 billion of business R&D in 2027-28, which is a 60% increase from £40 billion in 2020-21. The Government will consult on the design of a single scheme and, ahead of the spring Budget, work with industry to understand whether further support is necessary for R&D-intensive SMEs without significant change to the overall cost.

Alison Thewliss: It is a pleasure to follow the hon. Member for Amber Valley (Nigel Mills), who gave a characteristically thoughtful speech. How strange it is that we agree on so many things in this debate, and yet on so few other things. It would be nice if those on the Government Front Bench listened to some of the considered and sensible remarks from their colleagues.
This Finance Bill really does illustrate that we are all having to pay more tax, because of the very misguided steps taken by the former Prime Minister and her Chancellor, who crashed the economy in 26 minutes, leaving us all £30 billion worse off. That will have an impact on this broken UK economy not just now, but for many years to come.
Let me start with the energy profits levy. That additional tax on UK oil and gas profits will increase from 25% to 35% from 1 January 2023. As the hon. Member for Amber Valley observed, this is being extended until March 2028, which illustrates the extent of the mess into which the UK Government and their Chancellors have got themselves.
We think that the Government should go in a slightly different direction. They should look beyond just a levy on energy profits. They might want to look at a windfall tax that includes share buybacks as well. That is something that Biden has done in the United States. That has had the effect of bringing more money into the American Treasury’s coffers—Canada is also doing this—and encouraging firms to put more money into research and development, into investing in their companies and into investing in the UK, rather than spending all their excess profits on share buybacks, That seems like an entirely sensible thing to do, given the state of the UK economy. This year, BP has earmarked £7.15 billion to buy back its own shares. The Treasury should look at what more can be done here.
The reduction in the investment allowance is to be welcomed, but that it exists at all remains a barrier to decarbonisation. The allowance creates a perverse incentive for companies to favour new oil and gas exploration over renewables by effectively offering them a tax break for doing so. Shell paid zero windfall tax under the previous scheme, as it invested heavily in oil and drilling instead of filing profits to be taxed against. That is hardly worth a candle compared with the net zero commitments that the Government tried to make at COP26 last year.
We are also concerned about the decision to impose a 45% tax on electricity generators as that can then undermine investment into renewables at the same time as allowing oil and gas companies to drill more. The chief operating officer of SSE has said that the company may have to “give up” on some of its plans when the tax comes into effect. He said:
“It’s going to take money away from us…and we won’t have as much to invest.”
The CEO of Renewable UK also said:
“Any new tax should have focused on large, unexpected windfalls right across the energy sector, instead profits at fossil fuel plants are inexplicably exempted from the levy.”
Scotland has a significant renewables sector. It has been a great success story. Anything that makes that sector less profitable and more uncertain is something that we are deeply worried about.
The ordinary rate of income tax is now frozen until April 2028. Significant stealth taxes are coming in, as the Treasury stands to raise considerable revenue due to inflation. The Institute for Fiscal Studies has estimated that this could raise £30 billion by 2026 due to high inflation rates. It is unacceptable for this money to be raised by taxing those already struggling with spiralling living costs. Of the many options available to the Chancellor, it would have been better to tip the balance more in favour of those who can afford to contribute more, by which I mean greater taxes on wealth and income made from wealth, and also taxes on the non-doms, which could bring in £3.2 billion to the Treasury’s coffers. It is unacceptable that the Treasury would turn down the chance to bring in £3.2 billion and instead choose to freeze the thresholds, so that people on lower and middle incomes will receive less in their pay packet each month.
AJ Bell has found that if allowances are frozen rather than linked to inflation, an average earner on a salary of £33,000 in 2021-22, before the income tax threshold freeze began, will end up paying £2,600 more in income tax if the policy is extended to 2027-28. Someone on £50,000 will pay an additional £6,570 in tax because the allowances are frozen rather than being linked to inflation. I ask Ministers to consider the fairness of those measures.
Moving on to the research and development expenditure tax credit rate, the scheme has provided tax reliefs to companies subject to corporation tax that carry out eligible R&D activities. I appreciate what has been said about the efficacy of R&D tax credits and whether they are useful. I hope that topic will receive more consideration in the months and years ahead, because the UK tax code is full of different types of credits, tax breaks and incentives—or disincentives—and we need to properly understand how effective they are.
Small and medium-sized enterprises provide around three fifths of the UK’s private sector jobs and have historically been drivers of innovation and growth.  They are a significant part of solving the UK’s productivity puzzle. SMEs are less likely than larger companies to have access to formal credits to fund R&D, and in the wake of the pandemic and with recession forecast across the next year, it is more important than ever that SMEs are supported in driving growth and investing in research and development.
It is quite perplexing the Chancellor has prioritised R&D in larger firms, which are more likely to invest their profits elsewhere or perhaps invest them in share buybacks further down the road. The Chancellor has said that the aim is to reduce fraud, but reducing the R&D expenditure credit for all SMEs in an attempt to prevent its being abused seems a bit like throwing the baby out with the bathwater. It is quite poor targeting to affect all SMEs rather than just those that might be abusing the system.
The Federation of Small Businesses has said that the cut to R&D tax credits, which the Government presented as a way of tackling fraud, would “crush innovation and growth”, creating a “doom loop” that
“makes a mockery of plans for growth.”
The Minister should listen carefully to the FSB when it raises such concerns.
The current situation is quite worrying and will have significant impacts on the Scottish budget. The Fraser of Allander Institute has said:
“The lack of any real ability on the part of the Scottish government to be able to flex its budget within year in response to unanticipated shocks remains a real limitation of the existing fiscal settlement…a strong case can be made for enhancing the Scottish government’s ability to borrow and/or draw down resources from its Reserve.”
It concludes that
“this level of inflexibility does not seem tenable.”
The Scottish Government face a £1.7 billion shortfall this year as a result of inflationary pressures, and that is just this year’s budget. John Swinney has gone back and tried to strip out anything he can from the Scottish budget to try and deal with the problem, but that shortfall remains. The Chancellor’s answer to that was £1.5 billion in Barnett consequentials over the next two years—nothing for this in-year shortfall and half of what we need across two years. That is not going to fix the pressures that the Scottish Government face. It is not going to fix the significant issues with pay deals that trade unions are legitimately asking for in Scotland to support their members. If the UK Government does not come up with that money, it will cause extreme difficulties for the Scottish Government’s ability to meet their expectations of what they want to do.
What we are seeing from the UK Government is something of a doom loop. The OECD says that the UK will contract more than any other G7 country and that, of the G20, only Russia will fare worse than the UK. We see stagnant growth and no plans to get the economy back on track. The Chancellor and the Government want to bring forward plans to try to cut their way out of recession. That will not work. As the hon. Member for Amber Valley pointed out, consumers see that, and it affects both consumer and business confidence. Unless we hear a lot more about investment rather than cuts, this Government are going to sink the economy and take Scotland down with them.

Matt Western: It is a pleasure to follow the hon. Member for Darlington (Peter Gibson).
We have heard a great deal about the recent Budget—the last couple of Budgets, I suppose—and where we find ourselves, but we are not just talking about the events of  recent weeks or what could be described as global headwinds. We have to understand what has been going on in the wider landscape—the energy price shocks suffered globally, the supply chain shortages and the rising global interest rates—but beyond what could be described as global factors, we have specificities: the factors that set the UK apart from other nations.
I take on board a lot of the comments that have been from the Government Benches, but as the Institute for Fiscal Studies put it, it is clear that the UK is in a much worse position because of its economic own goals. We could talk about the impact of the bodged Brexit deal, which economic forecasters have shown has impacted our growth figure by 4.5%, or the shocking, catastrophic kamikaze Budget of 23 September, but we have suffered a decade of anaemic growth and now we are set for even weaker growth.
As has been said, of course the pandemic impacted on our economic situation, as it has across the world—we need only look at what is happening in China right now and what will be happening to Chinese GDP as a result of all the measures there. However, we face even weaker growth than others. We will have the weakest growth out of all the major economic nations of the G7, and over the next two years we will have the lowest growth out of all 39 nations in the OECD, other than sanction-ridden Russia. In fact, the Office for Budget Responsibility predicts that over the forecast period growth is set to average just 1.4%, compared to an average of 2.7% that we enjoyed over 13 years under the last Labour Government.
Last week, in its “Economic and fiscal outlook” report, the OBR confirmed that the autumn statement measures added nothing to growth in the medium term. Real wages are lower now than they were when the party opposite entered power in 2010. That is the harsh reality of what we are talking about. We can talk about all sorts of statistics in the abstract, but people will know just how hard this is already hurting and how hard it is going to get. I do not know whether any of us will be able to recall this, but the last time we had such a 12-year period of wage stagnation was back in the Napoleonic wars, which is a pretty damning indictment.
This has real impacts for everybody in our society, and I will set out a few markers. My constituents, along with people across the country, will see a staggering 7% real-terms reduction in their income over the next two years, leaving the average worker £40 worse off. To give a different perspective, the Resolution Foundation said that compared with trends seen when Labour was in government, people will be £15,000 worse off, coupled with sky-high inflation that disproportionately falls on poorer households, as the hon. Member for Leicester East (Claudia Webbe) said. While food inflation has increased by 14% across the board, certain basic staple products have increased by as much as 60%, as I can see in the shops in my constituency of Warwick and Leamington.
Businesses are also suffering. I appreciate that measures have been put in place, but the lack of business rate support is a glaring omission by this Government. One of the things that should be concerning them the most is the lack of business investment and the OBR forecast  that we will now see business investment growing by 6.7% less over the coming years. That must give all of us concern for our long-term economic growth.
Something else that should concern us is what has happened to the FTSE 100. Okay, it is just a bellwether indicator, but it is now smaller than the CAC 40 in Paris—the first time that Britain’s stock market has lost its position as the most highly valued in Europe. When we look back to 2016, we see the significant reversal of fortune: London was worth about $1.4 trillion more than Paris.
Ten days ago, there was a political choice in respect of the Budget: stealth taxes on working people, or a fairer tax system. I fear that the Chancellor has gone in too hard on hard-working people when it comes to footing the bill. He claimed to be fair, but he has not been. The recent Bank of England monetary policy report spoke of the impact of UK-specific factors on borrowing costs. The Financial Times estimates at just under £17 billion the real-terms spending increase in the mini-Budget due to the increase in the gilt rate. This economic crisis was made in Downing Street and its cost is being put on the shoulders of working people: the tax burden is the highest since world war two.
The Prime Minister’s decision to give oil and gas giants such large untargeted tax breaks has been surprising. It will cost the taxpayer £8 billion over the next five years. He and his Chancellor could have closed the tax loopholes, introduced VAT on private schools, tightened the energy profits levy, abolished non-dom status, launched a massive, much needed investment in skills and support for SMEs, and turned the UK into a green superpower. What we have instead are stealth taxes, which will take us backwards. I accept and agree with some of points made about corporation tax, particularly those of the hon. Member for Amber Valley (Nigel Mills). We saw a dreadful experiment under George Osborne that actually yielded very little for the UK but lost us a lot of tax take.
Under clause 6, there are changes to income tax, and the concern is how those will affect a lot of earners across the UK. What analysis has been done on the upper decile, or the top 2% of taxpayers? How does the impact on them compare with that on the lowest decile of earners?
As chair of the all-party parliamentary group on electric vehicles, I have a particular concern about clause 10, although I make these comments personally. The introduction of vehicle excise duty for zero-emission vehicles risks stalling the entire electric vehicle industry. We have already taken away consumer support, apart from some support for business users; we are the only major nation in Europe that does not provide such support for electric vehicles. There could be a real challenge as a result of the vehicle excise duty supplement, which will unduly penalise more expensive vehicle technologies when we should be ensuring that the sector expands and is successful. If we are to meet our net zero obligations, we have to persuade the consumer to come with us and increase the uptake in new electric vehicles.
We needed a framework that would encourage consumers and businesses to buy electric vehicles and get the industry to invest in the infrastructure network of EV charging points. Like the industry, I am really concerned  that the change will have a serious impact and that investment, including from vehicle manufacturers, will be lost.
Labour’s plan would be to reboot the economy, to create the frameworks for businesses to operate within, to scrap business rates and to replace the apprenticeship levy with a skills and growth fund. We need to invest in skills and further and higher education, particularly to address the matter of productivity; it is disappointing that we did not hear about that from the Minister. Productivity is one of the greatest challenges for the UK, yet we have heard far too little over the last 12 years about how that will be addressed.
I will not support Second Reading, although I will, of course, support the Labour amendment. The Bill raises taxes unfairly on working people and introduces what will essentially be a fiscal drag over the coming years. We should have started by going after the easy money—the tax status of non-doms and further reductions in the tax allowances available to oil and gas companies. We should have replaced business rates with something far more progressive that would help our local businesses and maintain and restore our town centres.
Since 2016, 1.2 million zero-carbon homes could have been built; it would have meant zero heating bills for 1.2 million families. Sadly, the legislation got scrapped in 2011—just think of the impact that would have had on our energy demand and the relative prosperity of those households. Instead, we have austerity. Under Obama, the US had the American Recovery and Reinvestment Act 2009—and look at its trajectory since.
I am afraid that this Finance Bill has sold the UK public and UK businesses short. We have had 12 years and the last 12 weeks—far too long. We need a Labour Government.

Peter Aldous: For a moment, I thought that you had forgotten me, Mr Deputy Speaker, but that is greatly appreciated.
The purpose of the Bill, as the Minister—my fellow Suffolk MP—said at the beginning, is to put on to the statute book many of the tax and spending decisions that the Chancellor announced in his autumn statement, with some others being deferred until the spring Finance Bill in 2023. The Chancellor was confronted with an incredibly difficult challenge on 17 November, so in many respects, he was between a rock and hard place. I genuinely believe that he struck the right balance and delivered the statement that the nation required in these very precarious times. He was right to protect the most vulnerable and to provide additional funding for health and social care and education, although on the latter, I think that he should also have included further education and colleges, which are so important in improving the UK’s productivity and providing the many, not the few, with the opportunity to participate in the proceeds of growth that we are so elusively seeking. That said, the Chancellor has appointed Sir Michael Barber to provide a skills reform programme, and he is to be commended for confirming support for Sizewell C, for providing Suffolk with a devolution deal, and for committing to a step change in the drive to improve the energy efficiency of our existing homes and businesses.
I feel that my right hon. Friend had no alternative other than to introduce levies on oil and gas producers and electricity generators. I will focus much of the remainder of my speech on that issue. There is a need to avoid any unintended consequences in the way that the levies operate, which could deter inward investment, which is so important to ensuring our energy security, meeting our net zero targets that enable us to tackle climate change, and regenerating the economies of many coastal communities, such as the Lowestoft and Waveney constituency that I represent.
Clauses 1 to 3 detail the changes proposed to the oil and gas profits levy: raising the rate of the levy to 35%; reducing the investment allowance from 80% to 29%, although it remains at 80% for investment on upstream decarbonisation; and extending the levy to 2028. That last provision appears somewhat random, because it takes no account of the fact that our current very high gas prices may have fallen by then. We should remember that, only a few years ago, gas prices were on the floor.  I hope that, if we are in a different place before 2028, the Government will look at bringing forward the  sunset clause.
I note that HMRC’s assessment concludes that the
“changes to the Energy Profits Levy are not expected to have a significant macroeconomic impact on the level of business investment”
and that the impact on business will extend only
“to around 200 companies operating in the UK or on the UK Continental Shelf.”
Those findings are very different from those of Offshore Energies UK, which is the trade representative of many of the businesses affected and which provides the secretariat for the British offshore oil and gas all-party parliamentary group, which I chair. It states that
“the tax changes would impact not just North Sea operators but the hundreds of other companies in their supply chains”,
which are so important to coastal communities such as Lowestoft and which extend right across the UK. It notes that such businesses
“provide specialised services such as marine engineering, deep sea diving or subsea communications”,
which are not just important to the oil and gas sector, but vital to the emerging industries of offshore wind, carbon capture and storage, and hydrogen production.
Offshore Energies UK points out that the industry—private business—
“is participating in plans to invest £200 billion by 2030 across all energies, including the lower-carbon ones needed to drive the energy transition.”
There is a real worry that disruption to the tax system could deter that vital investment. Although the Bill does not cover the electricity generator levy— I welcome the Minister’s commitment to engage with the industry before detailing the Government’s proposals— that levy’s provisions and implications should be considered alongside the energy oil and gas profits levy. That is because today’s renewables and oil and gas industries are inextricably interlinked and intertwined.
There is a real worry in the renewables sector that the electricity generator levy may deter the investment needed to end our reliance on fossil fuels. The companies that will be affected are those to which we are looking for investments of billions to accelerate the renewable energy transition. It is only by attracting such private sector investment that the UK can successfully grow its capacity in renewable energy. To meet our 2030 and 2050 targets, we need to attract more private investment, not deter it.
With that in mind, it is concerning that electricity generators are due to miss out on an investment allowance for new wind projects. If we are to be a global leader in offshore wind, including being a pioneer in floating offshore wind technology, there is a strong case for tax incentives to encourage new investment. That does not mean helping energy firms to avoid tax, but it does mean encouraging them to invest in the UK’s clean future for the benefit of the environment, of our future prosperity and of our energy security.
There needs to be a windfall tax, but it must be introduced in a form that is predictable, transparent and fair so as not to undermine investor confidence. I fully recognise that the enormous cost of shielding people and businesses from the worst impacts of the gas crisis requires a windfall tax, but there is a concern that the current and updated proposals for the oil and gas levy and the emerging plans for the electricity generator levy may, or might, have the unintended consequence of deterring investment at a time when we urgently need it, with a negative impact on the key policies of energy security, combating climate change, and levelling up.
It is good news that the Government have undertaken to carry out a long-term review of the tax treatment of UK oil and gas production. I also ask them to keep the oil and gas profits levy in place only while there is a windfall, rather than until 31 March 2028 if present conditions do not continue until then. There is much work to be done to create the stable, long-term fiscal environment required to maximise inward investment. Moving to net zero is a monumental challenge; the state of the public finances is such that we need more than ever to unlock private finance if we are to meet our targets.
Government and business must work together to put in place the long-term, stable tax regime that will ensure that companies make a full but fair contribution. Until recently, Government and business were working well together and a clear industrial strategy was in place, culminating in the 2019 offshore wind sector deal and the 2021 North sea transition deal. There is an urgent need for the Government and the energy industry to renew their marriage vows. I urge my right hon. Friend the Chancellor and his very good team on the Front Bench to set about the task immediately.

Resolved,
That an humble Address be presented to His Majesty, praying that His Majesty will re-appoint Mr William Lifford to the office of ordinary member of the Independent Parliamentary Standards Authority with effect from 11 January 2023 for the period ending on 10 January 2026.—(Penny Mordaunt.)

That the draft Investigatory Powers Commissioner (Oversight Functions) Regulations 2022, which were laid before this House on 18 October, be approved.
That the draft Investigatory Powers (Covert Human Intelligence Sources and Interception: Codes of Practice) Regulations 2022, which were laid before this House on 19 October, be approved.

That the draft Road Vehicles and Non-Road Mobile Machinery (Type-Approval) (Amendment and Transitional Provisions) (EU Exit) Regulations 2022, which were laid before this House on 20 October, be approved.
That the draft Road Vehicle Carbon Dioxide Emission Performance standards (Cars, Vans and Heavy Duty Vehicles) (Amendment) Regulations 2022, which were laid before this House on 20 October, be approved.

That the draft Telecommunications Infrastructure (Leasehold Property) (Terms of Agreement) Regulations 2022, which were laid before this House on 19 October, be approved.

That the draft Biocidal Products (Health and Safety) (Amendment) Regulations 2022, which were laid before this House on 18 October, be approved.

That the draft Air Quality (Designation of Relevant Public Authorities) (England) Regulations 2022, which were laid before this House on 27 October, be approved.—(Julie Marson.)
Question agreed to.

Rachel Hopkins: I thank my hon. Friend for that brilliant intervention. She is a fantastic champion for Luton North and Leagrave station; I am sure the Minister has taken note of the points she made so well.
Figures provided to me show that over 3.5 million passenger journeys were made via Luton station in 2019-20. Despite that, as mentioned by so many local people, poor accessibility is preventing many disabled and elderly people, young families, or those with luggage from travelling by train. At the moment, those with mobility restrictions are unable to access four out of the five platforms—and the one external lift to the ticket office upstairs is regularly out of order.
People unable to access the station are often forced to go out of their way to travel via Luton Airport Parkway station. However, Luton Airport Parkway, at the very southern tip of the town, serves Luton airport, both for travellers and workers, as well as associated businesses. It does not provide access to Luton’s town centre or the bus interchange.
Football fans visiting Luton for away games against the Hatters are also faced with the station’s accessibility issues, as well as what it looks like; the criticisms are similar from Luton Town fans. Just recently I was told that when Luton fans who travel by coach to away games are dropped back at Luton station after the game, some disabled fans cannot then access the platform they need to return home. Instead, their journey can take an additional hour or two, often late at night, as they have to go up to Bedford from platform 5, across, and then back down to Luton Airport Parkway or stations further south. It is either that or they have to pay for a taxi.
These transport issues are unacceptable now, but it is important to note that Luton Town are a football club on the rise. The club reached the championship play-offs semi-final last year and are currently one point from the play-off places. They are in the process of developing the exciting Power Court stadium, which will be closer to the train station and town centre than Kenilworth Road. It will have an increased capacity of initially around 7,500 more, potentially rising to 12,500 more, than Kenilworth Road down the line. Whether Luton Town are in the championship or make it to the Premier League, we will see an increasing number of visitors to the town, which will further demonstrate the accessibility issues.
I know that the Minister, like my mum, is an Arsenal fan. Just as an example, I ask how an Arsenal fan with a disability who follows their club around the country using the rail network would cope with travelling to Luton. I appreciate that Luton has been allocated Access for All funding, which will be used to create an obstacle-free accessible route from the station entrance to the platform, and that is very much welcome, but there are clear concerns about the delay in delivery and the continual dilution of the design quality.
The funding was allocated to Luton eight years ago. Due to deferrals, work on the lifts may not start until 2024, when we were led to believe that the work would be completed within the current control period by 2024. As well as these delays, there are concerns about the design of the lifts and the associated footbridge. Luton Borough Council has worked incredibly hard with stakeholders to identify preferred options. There are rumours that the roof may be removed from the footbridge connected to the lifts, seemingly without consultation with the council, exposing passengers to the elements. We know that installing lifts now will be more cost-effective over the long term, and the absence of a covered footbridge seems at odds with the design of other stations of similar size to Luton. Will the Minister outline when we can expect work on the Access for All-funded lifts to begin? When can we expect to see the finalised agreed upon design of the lifts and footbridge? I will be very disappointed if a minimal viable product of a footbridge, with no covers, was forced on Luton station to the detriment of local travellers.
That leads to another key point that people in Luton repeatedly raise with me. Shiny new lifts on a decrepit station do not address the overall problem that the station is not fit for purpose. I have some photos here, which I will happily ensure that the Minister leaves the Chamber with, so that he can see for himself. Passengers are not getting the value for money they deserve, whether it is access to platforms or avoiding the long-standing water feature, more commonly known as the rain that pours down from the leaky roof on platform 3. What impression does that give of our town? A train station is a gateway to a town and is key to creating the perception of a welcoming community. People travel to Luton town centre for a whole host of reasons—to work, for shopping, for business, to deliver public services, to study at the university and to enjoy our arts and culture. The station is also part of the walk-through from High Town down to the town centre—the clue is in the name —and it is used by people walking through at all times of day and night. All of these people experience a station that lets down our town.
Luton Borough Council has recognised the importance of increasing investment in the urban areas surrounding the station. Both the Bute Street car park mixed-use development and the Power Court development for Luton Town football club are within a stone’s throw of the thoroughly outdated Luton station. To maximise the potential of these developments and the regeneration of our town, we need a full redevelopment of the train station. As someone who says he is passionate about rail—I am, too—I am sure that the Minister agrees that rail can be a catalyst to regenerate areas. For every £1 that is spent on rail, £2.50 is generated for the wider economy.
A 21st-century station fit for the town we are, not the town we once were, could create huge economic and social opportunities for Luton. Improving the station as that gateway to our town centre would increase the attractiveness of Luton to residents and visitors, which is key to creating jobs, attracting investment and encouraging businesses to come to Luton.
Improving the station as a gateway to our town centre would increase the attractiveness of Luton for residents and visitors, which is key to creating jobs,  attracting investment and encouraging businesses to come to Luton. Improving Luton’s rail offer also aligns with the UK’s wider aim of reaching net zero. A positive rail passenger experience is vital to encouraging the modal shift from cars to rail. It is clear that the current experience of Luton residents is not encouraging them to make that shift.
I know that the Minister and the Government recognise that the current situation is unacceptable. A full redevelopment of the station is an essential part of our town centre’s revival. Will the Minister outline what discussions he has had with Department for Transport and Treasury officials about a full redevelopment of Luton station? In his recent letter, he offered to have a meeting to discuss Luton station further. I accept his offer and hopefully our teams can liaise to secure a meeting. I also invite him to Luton to see it for himself in all its glory—it is 25 minutes on the train from St Pancras. It is important to Luton that it finally gets the train station that it deserves. I look forward to working with the Minister to find a solution that works for our town.